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Abu Dhabi, UAEFriday 16 November 2018

Softbank and Didi to launch taxi-hailing service in Japan

Taxi operators will be able to track drivers and rides using heat maps

Masayoshi Son, CEO of SoftBank, has teamed up with China’s Didi in Japan. Bloomberg
Masayoshi Son, CEO of SoftBank, has teamed up with China’s Didi in Japan. Bloomberg

SoftBank and China’s Didi Chuxing are teaming up on a taxi-hailing platform for Japan, becoming the latest venture to bet on a market that’s lagged behind the rest of the world.

Called Didi Mobility Japan, the business will start trials this year in Osaka, followed by Tokyo, Kyoto, Fukuoka and Okinawa, the companies announced on Thursday. Taxi operators will be able to track drivers and rides using heat maps, while passengers will be able to summon rides and rate drivers via an app, which will also offer Chinese-Japanese translation.

Long dominated by taxis, Japan’s ¥1.7 trillion (Dh55.08bn) car-transport industry is starting to show signs of change. Sony is working on a joint venture with taxi companies called “Everybody’s Taxi”. Japan Taxi, the dispatch app run by the chairman of Nihon Kotsu, has also been actively promoting its services. Uber is starting a taxi-hailing pilot programme in the remote island of Awaji. With the 2020 Tokyo Olympics just around the corner, taxi operators are looking for ways to make it easier for customers to hail cabs and get to their destinations.

“Technology can be not just disruptive but also collaborative and inclusive,” Didi president Jean Liu said. He didn’t specify any taxi partners, although Didi was in talks with taxi operator Daiichi Koutsu Sangyo last year.

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Ride-hailing, where private-car owners can use their own vehicle to pick up and deliver passengers, is illegal in Japan. As a result, any ride-hailing services in Japan are essentially taxi and car-dispatch services. Earlier on Thursday, SoftBank chief executive Masayoshi Son deplored Japan’s regulations, saying that they stifled innovation.

“In Japan, ride-hailing is prohibited by law. It’s incredible that our national government is denying the future that is inevitable,” Mr Son said at SoftBankWorld, the company’s annual two-day event for customers and suppliers. “Is there a country that is as stupid as that?”

SoftBank and Didi, which first announced their partnership in February, is driven by Mr Son’s status as one of the most influential investors in ride-hailing. He has poured as much as $9.5bn into Didi and $9.3bn into Uber, and through SoftBank and his Vision Fund, also owns stakes in South East Asia’s Grab, India’s Ola and 99 in Brazil. Despite those investments Mr Son had yet to make a move into his home turf, until now.

Foreign tourists are a key reason why SoftBank and Didi decided to introduce a ride-hailing service in Japan. The archipelago has seen 16 million visitors so far this year, with Chinese tourists making up the largest group. The companies are betting that many of them will want to use their Didi app, which has about 550 million registered users, to summon rides.

The app will also make it easier to pay for rides using Alipay and WeChat Pay, in addition to credit cards, the companies said.